Ukraine, specifically the Yuzhnoye and Yuzhmash companies,
have played primary roles in the design and production of Russian strategic
missiles and space launch vehicles since Soviet times.But, much like the Ukrainian arms
industry, the Ukrainian aerospace industry, specifically the rocket and missile
design and production portion, is now at a crossroads.President Viktor Yushchenko's pursuit
of European integration may have a significant impact on Ukraine's aerospace
industry and its current primary partner, Russia.

A 25 January report from Interfax news agency stated that,
despite the election of pro-western Viktor Yushchenko, ballistic missile cooperation
between Russia and Ukraine would continue.Aleksandr Ryazhskikh, former deputy command of the Strategic
Missile Troops of Russia said that this cooperation was necessary to extend the
service life of SS-18 and SS-19 missiles.Ryazhskikh stated, "Up to 40 percent of the companies involved in
Russia's ballistic missile production remain in Ukraine." (1)Vladimir Dvorkin, the former head of
the 4th research and development institute of the Russian Defense Ministry,
involved research on strategic missiles, said "I believe that Kyiv will go
on implementing the agreement on keeping Moscow's missiles, made in Ukraine,
operational, and first of all the heavy class." (2)

After President Yushchenko's early April 2005 visit to the
U.S., he and President Bush signed a joint statement calling for their
countries "to work together on missile defense, including beginning
negotiations on a framework to facilitate such cooperation and closer
industry-to-industry collaboration." (3)It is not likely that Ukraine will be able to achieve the
delicate balance needed to pursue both partnerships, so will the Ukrainian
missile and rocket industry continue to have one dominant partner in Russia or
will it, like Ukraine in general under Yushchenko's plan, turn toward the West?

Russian-Ukrainian cooperation

Russian-Ukrainian cooperation in the area of missile and
rocket design started at the earliest stages of Soviet ballistic missile
development in the 1950's.Ukraine's design bureaus played a significant role as both a primary
designer and subcontractor on numerous Soviet ICBM's and even the Soviet
unmanned space program.

At the height of the Cold War's arms race, Ukraine's
involvement was as robust as ever.The design bureau at Yuzhnoye designed the two-stage heavy liquid
propellant ICBM SS-18 in the 1960's.They were also heavily involved in the development of the two stage,
tandem, storable liquid propellant ICBM SS-19, although this missile was
designed and produced in Russia.Ukrainian design bureaus devised the three-stage solid propellant ICBM
SS-24 in the late 1970's as a replacement for the SS-19.While the Russian design bureau created
the SS-25 in the early 1980's, the missile still used significant Ukrainian
parts and designs.More than 90
percent of its guidance system was drawn up and produced in Ukraine. (4) The
SS-27 Topol-M was the first strategic missile to be built by Russia without the
participation of Ukraine.

The Further Reduction and Limitation of Strategic Offensive
Arms Treaty (START II) signed by Russia in May 2000, would have obliged Russia
to dismantle all ground based ICBMs with multiple warheads.During the February 2001 visit by
President Putin to a Ukrainian missile plant and design bureau, Ukrainian
officials acknowledged they were already assisting Russia in maintaining both
SS-18 and SS-24 ICBMs in service. (5)

On 13 June 2002, this cooperation would become more
extensive; that is when the United States officially withdrew from the 1972
Anti-Ballistic Missile (ABM) Treaty, in order to develop and deploy a ballistic
missile defense system.After the
U.S. withdrawal, Russia decided not to ratify the START II treaty.The death of START II meant that Russia
could pursue a Strategic Rocket Force (SRF) that is much more dependent on its
older multi-warhead ICBM; as opposed to the more recently designed and deployed
single warhead versions.

Russia appears to be interested in maintaining much of its
older, heavy ICBM force (SS-18, SS-19, and SS-24). As previously discussed, the
SS-18 and SS-24 are multi-warhead configured, but were designed and produced
primarily in Ukraine which, depending on Ukraine's political environment, could
complicate or even eliminate cooperation in modernization efforts.Russia can still modernize the SS-19 component
of its SRF; it is the only ICBM in inventory that is both already multi-warhead
configured and produced mainly by Russian enterprises. The TOPOL missile (SS-25
and SS-27) while primarily designed and manufactured in Russia is single
warhead configured.The slow
development of the SS-27, the consequent slow deployment rate, and the
elimination of the START II requirements present Russia with both problems and
options.

U.S.-Ukrainian cooperation

While direct military to military cooperation has been
strong, especially in the NATO Partnership for Peace (PfP) program, the missile
and rocket industry, again much like the defense industry, has remained almost
exclusively a Russian area of cooperation.In 2003, Ukrainian officials expressed a desire to participate
with the United States in the possible development of a European theater
missile defense system, but little cooperation developed. (6)The one notable area of cooperation is
in the international Sea Launch Project with Yuzhnoye and Boeing working with
other partners to launch successfully 15 commercial payloads since 1999.With a change in Ukraine's political
situation, it looks like the stagnated level of cooperation could change.Earlier this year, there were meetings
between Pentagon officials and executives of the Ukrainian missile and rocket
industry to discuss increased cooperation.

Two specific issues seem to be driving the increased desire
for cooperation.First, is the
testing of the U.S. missile defense systems.Second, is a U.S. desire to increase rapidly the
transparency of Ukrainian defense and missile industry in order to limit
potentially destabilizing proliferation of sensitive information and materials.

The United States wants to conduct more robust testing of
the national and theater ballistic missile defense systems.Ukrainian rockets could provide the
vehicles for further testing, specifically the Cyclone 3 rocket.The Cyclone 3 is a three-stage liquid
fuel vehicle that better represents future "Rogue Nation" threats than
current U.S. test drones.It is a
1970's design that has proven to be highly reliable with more than 27
successful operational launches since 1991. (7)In addition to the missile defense benefits, increased
cooperation will help to engrain U.S. procedures with respect to information
and material control limiting potentially dangerous proliferation of these
technologies.

Ukraine's industry position

While Ukraine and the United States have more than a decade
of military cooperation, most economic cooperation in the defense and aerospace
field is fairly new.Russia and
Ukraine have a long history of successful cooperation and changing the
Ukrainian aerospace industry's orientation may prove to be difficult.As late as 2003, former Khartron
General Director Yakov Ayzenberg said that he believed Ukraine ought to aim for
closer economic relations with Russia.He even advocated selling large amounts of shares in Ukraine's aerospace
companies to Russian companies. (8)

Conclusion

The pursuit of ballistic missile defense by the U.S. led to
our abrogation of the ABM treaty, and the Russian decision not to ratify the
START II treaty.The cash-strapped
Russians have decided to extend the SS-18, SS-19 and SS-24 missile life,
something that would have been significantly limited under START II.

Both of these endeavors would be enhanced by Ukrainian
cooperation. Russia had the upper hand in this battle, until President
Yushchenko's remarkable rise to power.Now, as his pro-Western policy starts to trickle down and the U.S.
starts to embrace Ukrainian aerospace with actual contracts, it appears that
the possibility exists for far closer integration between the U.S. and
Ukraine.